Wyeth Settles Off-Label Marketing Claims for $490.9 Million

Wyeth Pharmaceuticals Inc., a Pfizer Inc. subsidiary, agreed to a $490.9 million settlement with the U.S. Department of Justice last month to resolve civil and criminal allegations of off-label pharmaceutical marketing abuses. The complaint alleged that Wyeth acquired by Pfizer in 2009, illegally marketed its immunosuppressant drug Rapamune, which is intended to help kidney patients accept transplanted organs. From 1998 through 2009. Its was contended that Wyeth instructed sales representatives to promote the drug for unapproved uses to boost sales. Stuart Delery, acting assistant attorney general for the civil division, said in a written statement:

FDA’s drug approval process ensures companies market their products for uses proven safe and effective. We will hold accountable those who put patients’ health at risk in pursuit of financial gain.

Wyeth pleaded guilty to criminal misbranding under the Federal Food, Drug and Cosmetic Act and will pay a criminal fine of $157.58 million and forfeit $76 million. A $257.4 million civil settlement will go to the federal government and states including Arkansas, California, Delaware, Florida, Hawaii, Illinois, Indiana, Louisiana, Massachusetts, Nevada, New Hampshire, New Mexico, Tennessee, Texas, Utah, Virginia and the District of Columbia.

The complaint, filed in 2005 by whistleblowers Marlene Sandler and Scott Paris, two former sales representatives, accused Wyeth of hyping Rapamune for use in transplants of organs other than kidneys and in place of or in combination with other immunosuppressants. In 2006, the DOJ declined to intervene in the case, a decision it reversed in 2010 following an inquiry by the House Committee on Oversight and Government Reform.

Grant & Eisenhofer director Reuben Guttman and senior counsel Traci Buschner represented Sandler and Paris in this case. Guttman had this to say:

You’ve got a case that speaks to countless patients whose medical regimens were dictated by marketing schemes and money as opposed to being dictated solely by medical rationale. It’s not just about money, it’s about people.

It shows the vulnerability of the health care system in the United States. Guttman pointed to additional False Claims Act litigation outcomes, including last year’s $1.5 billion settlement with Abbott Laboratories Inc., as evidence that problems persist in the health care industry.